Everything You Need to Know About the Montgomery GI Bill

Listen up, soldier: You put in two years of hard work for the United States armed forces. You trudged through rain, mud, and snow, and you pushed your body to its physical limitations.

Now, you are either still enrolled in active duty or are due to receive an honorable discharge. It’s time to look ahead to how you and your family will spend the next chapter of your life.

The Montgomery GI Bill Active Duty and Montgomery GI Bill Selective Reserve are two programs that can help assist your transition back into civilian life. They can also provide benefits for your spouse and dependents.

What Is the Montgomery GI Bill?

The Montgomery GI Bill, offered by the U.S. Department of Veterans Affairs, gives you the opportunity to make the most of your future with many different benefits, including more than $60,000 in cash to be put towards college, vocational training, or support services.

It is built on a maximum monthly payment rate that is currently $1,717, but automatically adjusts with inflation every year on the first day of October. So you will be given the most current payment rate based on the date that you enroll. Benefits will also fluctuate depending on whether you are enrolled in the Army, Navy, or Marine Corps College Fund.

The Montgomery GI Bill itself covers 36 academic months of benefits, meaning you can receive up to eight semesters, or four years, of school.

Here is a breakdown of what the program covers:

College, vocational, or business courses

Correspondence courses or distance learning

Job training or apprenticeship for veterans and Reserve members

Certification and licensing exams

Flight training

The Montgomery GI Bill is more than a support and service program, however. Also known as the GI Bill of Rights, it is a pillar of recruitment, and one of the most powerful draws for those considering enlisting in the armed forces.

Let’s take a look at why the Montgomery GI bill was created, how it has evolved, and how it can help propel you into an exciting, rewarding, and fruitful career after your duty ends.

Evolution of the GI Bill

Towards the end of World War II, U.S. officials began to realize the enormous sacrifice made by soldiers fighting in Europe, Africa, and Asia. So on July 28, during a famous Fireside Chat, President Roosevelt announced plans to ease the transition into civilian life for soldiers after the war.

"... the members of the armed forces have been compelled to make greater economic sacrifice and every other kind of sacrifice than the rest of us, and they are entitled to definite action to help take care of their special problems."Franklin D. Roosevelt July 28, 1943

This announcement led to the establishment of the first GI Bill, also referred to as the Serviceman’s Readjustment Act, signed into law on June 22, 1944.

The GI Bill changed the game completely for veterans. President Roosevelt’s policy came in response to concerns that World War I veterans were not adequately compensated for their immense efforts – they received $60 and a train ride back home. Many of the transitional programs offered today had not yet been created.

Making matters even more difficult for servicemen was the onset of the Great Depression that followed shortly after the war, as many servicemen had no way of supporting themselves.

The first GI Bill was made to repair these wrongs, and to ensure that these problems would never arise again.
It included, in addition to educational benefits, low-interest loans and zero down payments on suburban homes. This was crucial, as leading up to World War II the American dream of attending college and owning a home was not an attainable reality for most. The original GI Bill opened up the door to new possibilities that were previously very difficult to attain.

Aside from the aforementioned benefits of home loans and 48 months of education and training, other key provisions included funding for farms, businesses, and unemployment compensation.

A Wild Success

The GI Bill emerged as one of the most successful government initiatives following World War II. Instead of immediately going to work upon returning home, many veterans decided instead to learn a skill or to work towards a degree.

Astoundingly, only 20 percent of veterans opted for unemployment pay during this period.

The bill is largely credited for helping establish the American middle class and the Baby Boomer generation that soon followed, along with white picket fences, a black-and-white television in every living room, and all of the other staples of American suburbia.

However, this feel-good era following World War II would not last long. Soon after, the U.S. became embroiled in the Korean War, the first major conflict of the Cold War. The government realized that it needed to expand legislation to include benefits for the new group of veterans that would emerge. This led to the first set of critical changes to the GI Bill.

Korea and the Veterans’ Adjustment Act of 1952

In 1952, Congress passed the first Veterans’ Adjustment Act which granted benefits for those who were honorably discharged after 90 days of service. This bill became known as the Korean GI Bill.

Unlike the original GI Bill, the Korean GI Bill did not include automatic compensation for unemployment upon release. However, veterans were eligible to receive compensation for unemployment based on how much they made during the war, and when they were paid.

There were other differences between the Korean GI Bill and the original GI Bill. These differences included:

State and federal benefits: Unlike the GI Bill, the Korean GI Bill allowed veterans to collect state and federal unemployment compensation. Federal compensation kicked in when state benefits expired.

Different educational benefits: The Korean GI Bill changed the total amount of financial aid for education to 36 months, instead of 48.

Subsistence checks: Instead of paying institutions directly, the Korean GI Bill instead paid veterans in the form of monthly checks, which were meant to be used for college expenses.

By the time the conflict in Vietnam began to heat up, however, it was clear that further revisions were needed in order to support veterans who depended on monthly government stipends.

Veterans’ Readjustment Act of 1966

The Veterans’ Readjustment Act changed again in 1966, when President Johnson signed into law what would later become known as the Vietnam-era GI Bill.

At first, this bill was limited to those who served between Aug. 5, 1964, and May 7, 1975. However, the bill was later expanded to assist those who served as early as Feb. 28, 1961.

This is perhaps the most significant part of the Vietnam-era GI Bill; for the first time, veterans who served during peacetime were entitled to financial benefits after being discharged from the military.

Unlike the previous wars, however, Vietnam veterans faced many unique challenges upon returning home. The U.S. economy fell into a recession following the war, which resulted in high levels of unemployment.

There were also higher levels of wounded veterans after Vietnam as a result of advances in airlift technology and medical treatment during combat. Many soldiers who would have otherwise perished during battle in World War II or Korea came home with a need for ongoing medical attention.

Congress also realized it needed to provide for the increased number of soldiers returning home, so it extended the GI Bill’s original educational benefits, which eventually included 1 1/2 months of educational assistance for every month served in the war. While the Vietnam-era bill did not provide full tuition like the original GI Bill did, it did produce a larger number of college attendees. About 76 percent of veterans who were eligible participated in the program, versus the 50.5 percent who participated following World War II.

Post-Vietnam and the Montgomery GI Bill

After the war in Vietnam ended, the U.S. armed forces officially ended its practice of conscription, which had been in effect since 1940. This meant that the U.S. government needed a new way to encourage civilians to enlist in the military.

This led to the creation of the Vietnam Era Veterans’ Educational Assistance Act (VEAP) of 1977. This law allowed for service members to contribute up to $2,700 in educational funding, with the government matching $2 for every $1 invested by a soldier.

Unfortunately, participation in VEAP was low. In 1984, in response to low military recruitment numbers, Congress revamped the law and enacted the modern reimbursement system that is still used to this day (although the details and amount of compensation have changed since then).

The bill became known as the Montgomery GI Bill, named after its sponsor, Mississippi Congressman G.V. “Sonny” Montgomery.

The initial bill provided $300 per month of educational benefits for up to 36 months. In order to be eligible, service members were required to commit to three years of active duty in the U.S. armed forces. Service members were also given the opportunity to complete two years of active duty and four years in the reserve forces.

Additionally, service members were required to contribute $100 of nonrefundable monthly pay for the first 12 months they were enlisted.

How Has the Bill Changed Since 1984?

As we mentioned, financial compensation is automatically updated to include current inflation rates. In 2012, soldiers were offered $1,564. Now, it’s up to $1,717. Tiered offerings are available for those who attend school part time.

Benefits are available for those still in active duty, but the bill only covers tuition and expenses. However, once a soldier leaves active duty service, the GI Bill will pay for the full cost of college, with no limits for the cost of tuition.

In general, service members are encouraged to use the GI Bill during active duty only for higher-tuition costs or when using the Top Up benefit, which covers the cost of selective courses for active-duty members only.

Determining Eligibility

All service members who completed high school, are in active duty, or are discharged with full honors are able to participate in the program. If you are not eligible during or after your first period of active duty, you are eligible to participate during a following period of duty.

Additionally, you must fall into one of the following categories in order to receive Montgomery GI benefits:

I: Your first period of active duty began after June 30, 1985. Your military pay was reduced by $100 per month for the first 12 months, and you served continuously for three years, or for two years when you first enlisted. Or, you entered the Selected Reserve and participated in the 2 by 4 program.

II: Your active duty began before Jan. 1, 1977. You served for at least one full day between Oct. 19, 1984, and June 30, 1985. You stayed on active duty through June 30, 1988, or 1987 if your Selective Reserve service began one year after leaving active duty and you then served four years.

You also fall into this category if you have any remaining benefits from the Vietnam-era GI Bill.

III: You do not fall into categories I or II. You were on active duty on Sept. 30, 1990, and were separated involuntarily after Feb. 2, 1991, or were involuntarily separated on or after Nov. 30, 1993. You also fall into this category if you were militarily separated through the Special Separation Benefit (SSB) or the Voluntary Separation Incentive (VSI) programs.

Additionally, before separation your military pay was reduced by $1,200.

IV: You were on active duty on Oct. 9, 1996, and there were remaining funds in your VEAP account on this date. Additionally, you chose to select the Montgomery GI Bill by Oct. 9, 1997. Or, you entered full time into the National Guard through title 32, USC, between the dates of July 1, 1985 and Nov. 28, 1989. You also elected the Montgomery GI Bill for the period of Oct. 9, 1996 and July 8, 1997.

Your military pay was reduced by $100 per month for 12 months, or you made a lump-sum contribution of $1,200.

Where Will Your Next Journey Take You?

It took courage to enter the military in the first place; so don’t be afraid to re-enter the classroom to achieve your academic goals. While civilian life may seem daunting, the Montgomery GI Bill is an excellent opportunity to prepare yourself for a bright future.

Why else should you consider entering an educational or training program? You’ve already paid for it by serving in the military. Unlike traditional students who have to work part-time jobs, you have already put in your hard work. Packages like the Montgomery GI Bill will allow you to devote your time and energy to your studies. This will give you a leg up in the classroom, allowing you to take your career to new heights.

Perhaps you want to explore a career in electrical work or cosmetology. Maybe you are targeting a career in veterinary technology. Whether you are looking for a traditional college experience or an online opportunity, you can customize your educational experience to fit your needs and desires.

At Vista College, we’re waiting to guide you along the next step of your journey in life. Click here to view our list of available programs and see how you can get started today.

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